This blog captures interesting news items from around the world for those strained by information overload and yet need to stay updated on global events of significance. The news items displayed are not in order of merit. (The blog takes a weekly off -- normally on Sunday -- and does not appear when I am on vacation, travelling, or otherwise busy.)
Joe A Scaria
Former Senior Assistant Editor, The Economic Times, India

Sunday, August 31, 2014

1 Eurozone inflation near five-year low (BBC) he
eurozone inflation rate has fallen to 0.3% in August, near a five-year low,
adding to fears of a deflationary spiral, according to Eurostat figures. That
compares with a rate of 0.4% in July. The drop, driven by lower food and energy
prices, will add to pressure on the European Central Bank (ECB) to take action
to stimulate the economy.

Separate figures showed the unemployment rate
remained near a record high at 11.5% in July. Most analysts are not expecting
any action yet, but speculation is growing that in the coming months it may
inject money into the system, a practice called quantitative easing, in the
hope of stimulating growth and pushing up prices.

Mario Draghi, head of the ECB, has previously
described inflation at below 1% to be in a "danger zone".

"There
is plenty of ammunition here... to argue for more policy support," wrote
Jennifer McKeown from Capital Economics in a research note. "While the
Bank is unlikely to act at its meeting next week, it is likely to hint that
quantitative easing is firmly on the table," she added.

2 The mystery of Britain’s falling crime rate (Ian
Cobain in The Guardian) According to the official statistics, crime is falling
across Britain. It has been falling steadily for almost 20 years, despite the
occasional spike in the statistics for some forms of crime. And over the past
12 months, the sharpest fall – 19% – has been recorded in Northampton.

But it is not just the people of Northampton who are
perplexed by crime trends. Surveys have shown that while most people in England
and Wales believe lawlessness to be falling in the area where they live, the
overwhelming majority believe it to be rising nationally, when it has actually
fallen to its lowest level in decades. The Office for National Statistics (ONS)
believes this may be explained by the way some crimes are reported in the
media.

The experts are just as baffled as the public: like
the economists who failed to foresee the global financial crisis,
criminologists were taken by surprise by what happened during the years of
recession that followed the crash. Public spending was cut, unemployment rose,
incomes were squeezed, families resorted to food banks. And yet, against all
expectations, the number of recorded offences fell.

This phenomenon is not unique to Britain: crime has
been falling steadily across much of the western world. But while most senior
police officers, social scientists and Home Office officials accept that crime
is falling across Britain, they rarely agree on the cause. Some highly
respected criminologists believe so-called acquisitive crime must have risen
during the recession, and argue that the surveys are asking the wrong
questions: that new forms of crime – often perpetrated online – are not being
acknowledged.

3 Being fair to grads and non-grads (Straits Times) The
promise made by Singapore Prime Minister Lee Hsien Loong in his National Day
Rally speech earlier this month, that the public service could and would do
more to support the aspirations of non-graduates, is taking shape. The Public
Service Division (PSD) has announced that management support officers - most
non-graduates in the civil service are hired under the management support
scheme - who perform well and are able to take on larger responsibilities could
expect faster career progression.

This is not only equitable but reflects also the
need to give better career opportunities to a segment of the population that
does not possess a degree but is equipped with the right aptitude, skills and
attitude to contribute to an efficient and motivated civil service. It is the
end product that matters.

So long as high standards are maintained, the
educational starting points of civil servants should count less than the
contributions that they make at work. This consideration enjoys particular
weight in the case of teachers, whose academic proficiency, whether they are
graduates or not, must be complemented by a genuine desire to nurture the next
generation. That non-graduate teachers who perform well can now be placed on the
graduate salary scale recognises their role in a profession that is second to
none in moulding the future.

Graduates will have to justify the higher
expectations that society generally has of them; non-graduates will be spurred
into proving that they deserve no less. In the process, the best performers in
either group will shine, and be rewarded correspondingly. The sense of a gulf
between the two groups should narrow.

1 Brazil economy in recession (BBC) Brazil has
fallen into recession, just a month before the general election, latest figures
show. Economic output, GDP, fell by 0.6% in the three months to June, worse
than analysts had predicted, and revised figures for the first quarter of the
year also showed a fall of 0.2%. A recession is usually defined as two
consecutive quarters of contraction.

The news will be damaging for the government of
President Dilma Rousseff. According to the most recent poll, Ms Rousseff would
lose to a rival candidate, environmentalist Marina Silva, if October's election
went to a second round. The data showed that civil construction, manufacturing
and investment especially suffered during the second quarter.

"This recession shows the exhaustion of a
growth model that has been centred on internal consumption," said Eduardo
Velho, chief economist at investment firm INVX Global in Sao Paulo. "It is
a good picture of what the economy is suffering - a slowdown in industry, a
fall in investment, rising inventories. The recovery from here will be
slight," he continued, saying that deep reforms would be needed whoever
wins the next election.

2 A third of young workers on low pay (Toby Helm in
The Guardian) The proportion of workers aged 21 to 30 who are now classed as
low paid has more than tripled over the past four decades, according to new
research that helps to explain why many young people are locked out of the
housing market.

Analysis to be released next month by the
independent thinktank the Resolution Foundation will show that among this age
group almost three in 10 (29%) are now low paid – equating to almost 1.5
million young workers. In 1975, the proportion earning low pay was less than one
in 10 (8%). Over the same period, however, the proportion of low-paid older
workers – those aged 51 to 60 – has dropped sharply, highlighting a pronounced divide
between the generations.

The report comes amid growing concern that Britain's
economic recovery is not translating into wage growth and higher living
standards for large sections of society. Low pay is defined as earning less
than two-thirds of the hourly median wage – which currently stands at £11.56. A
low-paid person therefore earns less than £7.71 an hour. The fortunes of the
two age groups have diverged sharply since 2002, when the proportion in low pay
was 21% in both groups.

Matthew Whittaker, chief economist at the Resolution
Foundation, said the trend towards a low-wage economy for the young threw up
big policy challenges. "We know that younger workers have been hit hardest
in recent years – this shows that it's part of an even longer-term trend."
The share of young people buying homes fell to one of its lowest levels in June
this year because of a combination of high prices relative to incomes and
shortage of supply.

3 Google’s fleet of package-delivery
drones (San Francisco Chronicle) Google's secretive research laboratory is
trying to build a fleet of drones designed to bypass earthbound traffic so
packages can be delivered to people more quickly. The ambitious program
escalates Google's technological arms race with rival Amazon.com Inc., which
also is experimenting with self-flying vehicles to carry merchandise bought by
customers of its online store.

Amazon is mounting its
own challenges to Google in online video, digital advertising and mobile
computing in a battle that also involves Apple Inc. Google Inc. calls its foray
into drones "Project Wing."

Although Google expects
it to take several more years before its fleet of drones is fully operational,
the company says test flights in Australia delivered a first aid kit, candy bars,
dog treats and water to two farmers after traveling a distance of roughly one
kilometer, or just over a half mile, two weeks ago..

Besides perfecting
their aerial technology, Google and Amazon still need to gain government
approval to fly commercial drones in many countries, including the US. Amazon
last month asked the Federal Aviation Administration for permission to expand
its drone testing. The FAA currently allows hobbyists and model aircraft makers
to fly drones, but commercial use is mostly banned.

Google seems to see its
drones as something more than another step in e-commerce delivery. The aerial
vehicles also could make it easier for people to share certain items, such as a
power drill, that they may only need periodically and carry emergency supplies
to areas damaged by earthquakes, hurricanes and other natural catastrophes,
according to Google's Project Wing pamphlet.

Friday, August 29, 2014

1 Pessimism reigns about US economic ‘recovery’ (Andrew S
Ross in San Francisco Chronicle) Perhaps the most telling finding in the latest
survey of America's post-Great Recession mood is this: Seven in 10 believe the
US economy has changed permanently - for the worse. That comes from the John J.
Heldrich Center for Workforce Development at Rutgers University in a survey,
titled "Unhappy, worried and pessimistic." Indeed, it makes for
depressing - but not really surprising - reading.

Five years into the economic "recovery" the vast
majority don't believe the economy has gotten any better, despite reassurances
to the contrary. They believe their children are going to have it even harder -
and think there's nothing the federal government can do about it. Sorry to be a
drag on the eve of Labor Day weekend, but other reports this month tell much
the same story, in contrast to the roaring stock market and growth in
employment and gross domestic product.

The Economic Policy Institute finds that hourly wages in
real terms in the first half of 2014 were lower than in the same period last
year, "even for those with a bachelor's or advanced degree." A major
reason, says the institute: Economic growth is not being reflected in higher
wages. "Most striking to me is how there's this consensus among Americans
about this diminished economy," said Carl Van Horn, director of the
Heldrich Center and co-author of the center's report. "It's upset their
expectations about how working life and the American life should be."

2 UK retailers most optimistic in 12 years (Angela Monaghan
in The Guardian) Retailers are ending the summer on a high and are feeling more
confident than at any time in the last 12 years following a sales surge in
August. Optimism within the industry about business prospects for the coming
three months was the strongest since May 2002, the CBI said in its latest
snapshot of the retail sector.

Katja Hall, the business lobby group's deputy director
general, said: "The high streets have been bustling with shoppers this
summer and it is good to see firms so optimistic about their business prospects
for the next three months – higher than at any time since 2002. Retailers
looking forward to stronger growth in September are keeping their shelves well
stocked in anticipation."

Strong high-street sales were matched by an increase in
consumer confidence in August, with market research group GfK's monthly tracker
of the nation's mood taking it back into positive territory for only the second
time since March 2005. The index rose by three points to 1 from -2 in July,
matching June's level.

3 Attenborough’s gift to India (Rahul Singh in Khaleej
Times) Filmmaker and actor Sir Richard Attenborough, who died recently at the
age of 90, has received glowing accolades in the British media. However, India,
too, has good reason to remember and thank him. Though Mohandas Karamchand (“Mahatma”)
Gandhi was an international icon much before Attenborough came on the scene, it
was Attenborough’s epic film on the Mahatma, Gandhi, that brought Gandhi and
his philosophy alive to a new generation, worldwide. Gandhi was a huge,
incalculable gift to India, for which Indians should be eternally grateful to
Attenborough.

The film was an unlikely box-office hit. When Attenborough
was trying to raise funds for his venture, he couldn’t find any takers. He was
told by an American producer that there would be no audience for “a little
brown man with a sheet, carrying a beanstalk”. So, Attenborough had to mortgage
his house and sell some of his art collection to raise money. To its credit,
the Indian government also came to his assistance. India’s first Prime
Minister, Jawaharlal Nehru, a renaissance man who admired Attenborough, gave
his moral support.

Then, Nehru’s daughter, Indira Gandhi, pitched in with funds
from her administration, in the teeth of bitter opposition. “How can a
foreigner make a film on the Father of the Indian nation?” they asked
indignantly. But Attenborough was on a mission and was undeterred. Yet, nobody
expected him to recoup the $22 million it cost him to produce Gandhi. He proved
his critics wrong. He earned 20 times that amount.

For the main role, that of the Mahatma, Attenborough chose a
little-known actor, Ben Kingsley. It was an inspired choice. Kingsley gave the
performance of his life – he won an Oscar for it – bringing out the essence of
the man, including his quirks. What many people do not know is that Kingsley is
half-Indian and that his real name is Krishna Pandit Bhanji – a name that would
not have taken him anywhere on the stage or screen, hence the name-change.

Rohini Hattangadi, as Kasturba, Gandhi’s wife, was another
wonderful selection, with stage actor and advertising “guru” Alyque Padamsee,
and Roshan Seth being effective as Jinnah and Nehru, respectively. Bhanu
Athaiya was chosen by Attenborough to design the costumes for the Indian sets.
She did such a great job that she became the first Indian to win an Oscar in
that category. Jack Briley, also relatively unknown, did the screenplay for
which he got an Oscar as well.

Running seamlessly through the film is Gandhi’s uplifting
philosophy and his message of love and non-violence. But for me at least, it
has an additional value: It is great propaganda for India. I am sure a great
many non-Indians who saw the film came to India as tourists, just to see the
“land of Gandhi”. And to think that if some important Indians had had their way
– and Attenborough had not been so persevering – the film might never have been
made!

Wednesday, August 27, 2014

1 Insurance industry covers $21bn losses for natural
disasters this year (Sean Farrell in The Guardian) The global insurance
industry covered $21bn of losses from disasters in the first half of 2014 as
fewer natural catastrophes kept claims below their long-term average.

The total economic cost of disasters in the first
six months was $44bn of which natural events made up $41bn, figures from Swiss
Re, the world's second-biggest reinsurer, showed. More than 4,700 people were
killed by natural disasters during the period. The figure for overall economic
costs was down from $59bn a year ago and was less than half the first-half
average of $94bn in the last decade.

The $21bn total bill for insurance companies fell
from $25bn in the first half of last year and a 10-year average of $27bn.
Natural disasters made up $19bn of costs in the first six months of 2014 with
manmade events accounting for another $2bn. Insurance losses hit a record of
$116bn in 2011 with most of the losses in the first half when the Japanese
earthquake cost the industry $35bn.

2 Religion, power and the Arab revolution (Mustafa
Al Zarooni in Khaleej Times) Radical thought and extremist actions have plunged
some nations and people into the abyss and are an impediment to their progress.
The trend doesn’t confine itself to religion. This ‘thoughtful backwardness’ is
repugnant and makes society stuck where it is. It rejects the views of others,
something that the West too has suffered and has tried to eliminate so it can
live in peace.

History takes us back to the authoritarian control
of the Church on all aspects of life in Europe: waging wars and killing the
innocent in the name of religion. This caused European nations to grope in the
darkness of backwardness. Eventually, the suppressed people revolted against
the domination of the Church and shunned it.

Hitler’ racist ideas also sparked worldwide
revulsion; alliances were forged to unseat him and eradicate his Nazi regime
during the Second World War, after which the new world map as it appears now
was drawn. The current Muslim World is in the same boat of that of the Europe
of yore. It also suffers in its efforts to convey tolerance that enshrines
Islam, which is now being viewed as a religion that glorifies war, killing and
extremism.

Muslims, who constitute 23 per cent of the world
population, are perceived in negative light, their backwardness showcased and
their achievements not getting pride of place in societies. Extremist groups
have lured and dragged many youth into their cobweb of narrow thinking. Taboos
and bigotry are the norm. Their science and knowledge is only what they write
and preach.

Despite their despicable actions, religion and
doctrine should remain solid-rock in our hearts. We should live by the complete
code of life and shun repression and violence, which they use in their train of
thought. Power can be usurped from the naïveté of a few using religion as a
garb. Faith in religion is infinite; it preaches and calls for tolerance, love
and ethics.

The new Arab revolution of hearts and minds will be
against all forms of extremism preached and practised by the likes of ISIS and
the Muslim Brotherhood. Peace will get its chance; it will prevail.

3 Five skills for a great boss (Belo Cipriani in San
Francisco Chronicle) While some people are natural leaders, without
self-reflection and practicing good supervision techniques, their innate
abilities may never blossom into great managerial traits. Here are five tips to
being an effective, amazing boss.

Get to know your team. Don’t pry into your staff’s
personal lives. Do let them voice their opinions on projects or process.
Whether they share their creative ideas or vent about a client, giving them the
space to be open will help you identify strengths and weaknesses.

Give feedback. While it’s not always possible to
give someone feedback on every project they complete, the more you do it, the
more consistent the employee will become. Even if it’s tips for improvement,
employees would rather know if something was done poorly right away than to
wait months to hear about it during a review.

Reward great work. People love to be praised and the
more we get it, the more we want it. So if someone on your team does a stellar
job, try buying their next cup of coffee or treating them to lunch. The more
you reward great work, the more you will get it.

Build trust. It’s important for employees to feel
like they can trust their boss. So, aside from having an open door policy and
reminding your team they can speak with you about anything at any time, try
giving your team company updates as they become available. By being completely
transparent with them, you will gain their trust.

Create synergy within your team. It may not be
possible for everyone on your team to be buddies, but it is important to create
positive experiences among them to help build synergy. A happy team is a
productive one. Addressing misunderstandings or tension immediately will help
you earn your team’s respect.

Tuesday, August 26, 2014

1 Global warming likely irreversible, says UN panel
(Seth Borenstein in San Francisco Chronicle) Global warming is here,
human-caused and probably already dangerous — and it's increasingly likely that
the heating trend could be irreversible, a draft of a new international science
report says.

The United Nations' Intergovernmental Panel on
Climate Change has sent governments a final draft of its synthesis report,
which combines three earlier, gigantic documents by the Nobel Prize-winning
group. The 127-page draft paints a harsh warning of what's causing global
warming and what it will do to humans and the environment. It also describes
what can be done about it.

"Continued emission of greenhouse gases will
cause further warming and long-lasting changes in all components of the climate
system, increasing the likelihood of severe, pervasive and irreversible impacts
for people and ecosystems," the report says.

Depending on circumstances and values,
"currently observed impacts might already be considered dangerous,"
the report says. It mentions extreme weather and rising sea levels, such as
heat waves, flooding and droughts. It even raises the idea that climate change
will worsen violent conflicts and refugee problems and could hinder efforts to
grow more food. And ocean acidification, which comes from the added carbon
absorbed by oceans, will harm marine life, it says.

The report says if the world continues to spew
greenhouse gases at its accelerating rate, it's likely that by mid-century
temperatures will increase by about another 3.6 degrees Fahrenheit (2 degrees
Celsius) compared to temperatures from 1986 to 2005. And by the end of the
century, that scenario will bring temperatures that are about 6.7 degrees
warmer (3.7 degrees Celsius).

2 The US in black and white (Mahir Ali in Khaleej
Times) There was no doubt a considerable degree of schadenfreude in social
media activity from official sources in nations such as Egypt and Iran in
reaction to the events of recent weeks in Ferguson, Missouri. The US, after
all, is seldom backward in offering condescending advice in relation to how
other governments deal with dissidence (inevitably with some notable
exceptions, particularly in the case of Israel).

What is far more embarrassing for the American
authorities is the fact that domestic confrontations reflect its overseas
military interventions, given that police forces across the country have been
equipped with army surplus gear. Sadly, it wasn’t an exceptional incident,
which was another reason why Ferguson exploded. Fatal consequences are relatively
rare, but who can seriously deny that they proceed from the same mindset that
leads the forces of the law to stop and search African Americans far more
frequently than whites?

And here’s one more interesting statistic: north of
a Ferguson dividing line called Delmar Boulevard, 98 per cent of the population
is black (with an average annual income of $18,000); south of it, 73 per cent
people are white (and the median income in $50,000). The renowned former basketballer
Kareem Abdul-Jabbar recently commented in Time magazine that in the context of
Ferguson “we have to address the situation not just as another act of systemic
racism, but as what else it is: class warfare”.

However, given the political will, a determined
effort to tackle institutionalised racism would surely yield some positive
results. At Michael Brown’s funeral, the Reverend Al Sharpton made an
impassioned call for action on policing — which would arguably be the obvious
place to start in terms of policies, attitudes, recruitment, training and, not
least, equipment. Sadly, a post-racial society — prematurely posited as a
possibility in the wake of Barack Obama’s election to the White House — remains
something of a dream deferred.

3 Mozilla’s $33 smartphone for India (BBC) Mozilla,
a company best known for its Firefox browser, has launched a new low-cost
smartphone in India that will retail for 1,999 rupees ($33). The phone is only
for sale on India's online shopping site, Snapdeal. The Intex Cloud FX runs on
Mozilla's Firefox operating system and as such it will be the first low-cost
device running that system available in Asia.

India's emerging market is regarded as the world's
fastest growing for low-cost smartphones. Various emerging markets across Asia
are seen by mobile device manufacturers as the key remaining areas for massive
growth. Analysts expect these types of low-cost smartphones to give users in
emerging markets an affordable opportunity to upgrade from so-called feature
phones - or phones that do not easily access the internet.

"The price point
is what will grab the market's attention," said Bryan Ma of research firm
IDC, "but that's just one factor in all this.It's the ecosystem we look at
- or what kind of applications are available on the phone. That is more worth
talking about. That's an example of what we might call an 'app-gap' - or the
lack of applications on cheaper smartphones compared to those available on
phones that use Android and other such operating systems," he explained.

1 Growth is no more the enemy of the planet (Chris
Huhne in The Guardian) Until now the story of human prosperity has been all
about cheap, abundant energy. However, something big has been happening. For
the first time in history, we are growing richer while using less energy. That
is unalloyed good news for budgets, incomes and the planet. We have reached a
technological tipping point.

From the middle ages, living standards just edged up
at a snail’s pace, and we did little damage to the planet, because growing
forests absorbed carbon from wood burning. The population was small. We led
lives that were, in Hobbes’ phrase, “nasty, brutish and short”. Then we started
burning coal on a large scale in the 18th century, and the industrial
revolution made the graph look like a hockey stick: suddenly incomes were
doubling in decades, following centuries of stability.

After allowing for inflation, real GDP in England
and Wales doubled from 1830 to 1864, again by 1898, and again by 1951, despite
two world wars. This unprecedented prosperity and welfare was inextricably
linked to the burning of fossil fuels, and therefore to the beginning of carbon
emissions and global warming. And we are paying with the steady rise in carbon
and temperatures compared with pre-industrial levels.

The good news is that we can increasingly see a
future where technology does most of the change for us. Readers of the Digest
of United Kingdom energy statistics will find an extraordinary table in the new
edition: the two-century link between growth and energy has broken. The UK
economy has doubled in real terms since 1985, but total energy consumption is
exactly the same as it was in that year. Indeed, energy consumption has fallen
since 1970 while the economy has nearly trebled in size.

2 In tech, Asians are left out at the top (Kristen V
Brown in San Francisco Chronicle) When Buck Gee was a vice president at Cisco
Systems, he one day looked around his desk and noticed that he stood out in one
key way: Gee was the only Chinese American executive in Cisco's US product
development group. In fact, there were very few Asian American executives at
all.

Since then, Gee, who retired from Cisco in 2008, has
been a man on a mission. Asians are generally well-represented in technology
companies among the rank and file, but few ascend the corporate ladder to the
top. Gee wants to change that. The recent release of data on the diversity of
employees by more than a dozen tech companies has lent new vigor to Gee's
campaign to shatter what he calls the "bamboo ceiling."

He points to Yahoo, where Asians hold 17 percent of
leadership positions while making up 39 percent of its US workforce. That
pattern persists across most tech companies. "A long time ago, Asians were
considered the model minority," Gee said. "But certainly, at least in
business, we're now the missing minority."

In a paper Gee published this year, he noted that
factors preventing more Asian Americans from moving up the ranks include a
traditional deference to authority, ineffective communication skills and an
aversion to risk taking. Many Asians, he said, are brought up with an emphasis
on acquiring skills and achievements, but not on the "soft skills"
necessary for managing people at a high level. But the biggest problem may be
that no one seems interested in talking about the lack of Asians at the top.

3 Why Gen Y finds it hard to be hired (Sylvia
Pennington in Sydney Morning Herald) While over-50s say the odds are stacked
against them when it comes to getting a job, the going is equally tough for
those at the other end of the age spectrum - school leavers and young people
with minimal work experience.

Older Aussies believe ageism and a risk-averse
labour market are some of the reasons they're out of favour with employers. But
why are Australian businesses also saying no to the notion of taking on and
training up a young 'un? Too expensive and too much aggro, says the founder of
the MiniMovers removalist chain, Mike O'Hagan, who used to pride himself on
giving a couple of school leavers a go each year.

“When you have a downturn in the market . . . hiring
young people is going to be one of the first things you stop,” he says. The
lacklustre work ethic and entitlement mentality of the latest Me Generation
have also soured his attitude in recent years. Many youngsters have had their
sights set too high, both at school and at home, and view a good job as their
right, regardless of their ability, O'Hagan says.

Latest jobless figures from the Australian Bureau of
Statistics suggest plenty of employers share O'Hagan's views, given the growing
number of youngsters languishing in the job queue. The national youth
unemployment rate for 15 to 24 year olds looking for work has risen to a 12
year high of 13.1 per cent, more than double the general unemployment rate of 5.8
per cent.

Kids who've seen their parents on Struggle Street
are often the best bet, agrees Peter Coronica, the former long-time owner of
Melbourne's Café Florentine. “If they're from too affluent a family, you know
they won't work hard,” he says. “They think they're too good to be a waiter. They
treat work like a game of hopscotch . . . they're often searching for something
that doesn't exist.”

Sunday, August 24, 2014

1 Libya capital
under Islamist control (Chris Stephen & Anne Penketh in The Guardian) Libya
has lurched ever closer to fragmentation and civil war after Islamist-led
militias seized the airport in the capital, Tripoli, proclaimed their own
government, and presented the world with yet another crisis. Operation Dawn, a
coalition of Islamist and Misrata forces, captured the airport on Saturday in
fierce fighting against pro-government militias after a five-week siege that
battered parts of the capital.

The victory,
which secures Islamist control over Tripoli, was a culmination of weeks of
fighting triggered by elections in July, lost by Islamist parties. Rather than
accept the elections result Islamist leaders in Libya accused the new
parliament of being dominated by supporters of the former dictator Muammar
Gaddafi, and have sought to restore the old national congress.

Libya's official
parliament, the house of representatives, in the eastern city of Tobruk,
denounced the attack as illegal, branding Dawn a "terrorist
organisation" and announcing a state of war against the group. The move
leaves Libya with two governments, one in Tripoli, and one in the east of the
country, each battling for the hearts and minds of the country's myriad
militias.

The weekend's
developments threaten to tilt the country across the line from troubled
post-Arab spring democracy to outright failed state. Egypt and Sudan are known
to be watching developments closely, and last week the French president,
François Hollande, said that despite the crises in Iraq, Syria, Ukraine and
Gaza, his "biggest concern at the moment is Libya".

The security
situation has become so parlous in Libya that the nation has been forced to
withdraw as host for the African Cup of Nations in 2017. Many Libyans think
fragmentation is now inevitable, with Islamist-led forces strong in Tripoli,
and tribal and nationalists dominant in the east of the country. The key to
victory could be as much economic as military. Libya's government might have
lost control of the capital but for the moment it has international
recognition, ensuring access to the country's rich oil reserves and foreign
assets, worth an estimated £80bn.

2 India’s Modi
struggles to deliver reforms (Khaleej Times) Prime Minister Narendra Modi has
shaken up India’s ruling elite in his first 100 days since taking power, but
has so far struggled to deliver the bold reforms needed to kick-start the
economy. Modi swept to power in May on a tide of hope after years of political
stagnation and slowing economic growth in the world’s largest democracy.

His Hindu
nationalist Bharatiya Janata party (BJP)’s landslide election win gave them the
strongest mandate in a generation. But the new government’s first budget was
short on big-ticket reforms, and it ended its first parliamentary session in
power this month without managing to push through even modest legislative
changes.

Modi’s bold
election promise to lift millions of Indians out of poverty through market
forces took a further bashing when his government’s refusal to compromise over
its food subsidies threatened a trade pact agreed by all 160 World Trade
Organisation members. Inflation remains high at nearly 8.0 per cent, while
industrial output expanded by an unexpectedly slow 3.4 percent in June, dimming
prospects of a quick economic recovery.

Economist Bibek
Debroy of the Delhi-based Centre for Policy Research says Modi’s ambitious
targets will take time to fulfil. “Some things that need to be done for change
require institutions and mechanisms that haven’t yet fallen in place.” When it
comes to cleaning up those institutions, few fault Modi’s efforts.

Modi has
refocused India’s diplomatic efforts on neighbouring countries after years of
neglect and amid growing Chinese influence in the region. But early indications
of warmer ties with Pakistan were dashed on Monday when India cancelled
high-level diplomatic talks after Islamabad’s envoy held a meeting with
Kashmiri separatists.

Sadanand Dhume
of Washington-based think tank the American Enterprise Institute believes the
positives outweigh the negatives. “Modi has started more slowly than expected,
but most early signs are encouraging,” Dhume said. “As decisions pick up steam,
this government may well fulfil its potential to transform India.”

3 As
transfusions decline, blood industry shrinks (Matthew L Wald in The New York Times)
Changes in medicine have eliminated the need for millions of blood
transfusions, which is good news for patients getting procedures like coronary
bypasses and other procedures that once required a lot of blood. But the trend
is wreaking havoc in the blood bank business, forcing a wave of mergers and job
cutbacks unlike anything the industry, which became large scale after World War
II, has ever seen.

Transfusions are
down almost one-third over the last five years, to about 11 million units last
year from about 15 million units, according to the American Red Cross, which
has about 40 percent of the market. With “minimally invasive” techniques like
laparoscopic surgery and other shifts in medicine, demand for blood continues
to drop despite population growth and a soaring number of people over 65, who have
the most surgeries requiring blood.

Blood bank
revenue is falling, and the decline may reach $1.5 billion a year this year
from a high of $5 billion in 2008. As fewer units of blood are used, hospitals,
seeing strong supply and weak demand, are asking for a lower price per unit.

As a result, the
blood bank business has already lost some jobs, and the losses will reach as
high as 12,000 within the next three to five years, roughly a quarter of the
total in the industry, according to the Red Cross. Officials expressed some
concern that the decline could reduce the system’s ability to respond to crises
or to invest in new products or research.

From time to
time since 2008, the Red Cross operated at a deficit. But it balanced its
budget partly by cutting 1,500 jobs. Shaun Gilmore, president of Biomedical
Services at the American Red Cross, said the organization was also looking to
give up some real estate as it shrinks its operations to an appropriate size.

Blood services
amount to $1.8 billion to $1.9 billion of the group’s budget, which this year
is about $3 billion, executives said. Of the organization’s 26,500 employees,
17,000 work in the blood program. The Red Cross wants the blood program to
cover its own costs, or perhaps achieve a small surplus for reinvestment. One
reason for declining demand is that recent studies have found many transfusions
unnecessary, so patients are no longer getting expensive services that did them
no good.

Saturday, August 23, 2014

1 Wanted – A US job market fix (Khaleej Times) US
labour markets remain hampered by the effects of the Great Recession and the
Federal Reserve should move cautiously in determining when interest rates
should rise, Fed Chair Janet Yellen has said. Yellen said she felt the
unemployment rate alone was inadequate to evaluate the strength of the US job
market.

The jobless rate has fallen faster than expected,
but Yellen said the economic disruption of the last five years has left
millions of workers sidelined, discouraged, or stuck in part time jobs — facts
that are not captured in the unemployment rate alone.

Judging whether the economy is close to full
employment is “complicated by ongoing shifts in the structure of the labour
market and the possibility that the severe recession caused persistent changes
in the labour market’s functioning”, Yellen said.

The Fed has held benchmark rates near zero since
December 2008, and has said it would wait a “considerable time” after winding
down a stimulative bond-buying programme in October before raising them.
Financial markets currently expect rates to raise around the middle of next
year.

2 A start-up seeks to crowd fund Ebola cure
(Stephanie M Lee in San Francisco Chronicle) With the death toll from the Ebola
outbreak at 1,350, one biotechnology company after another is jumping into the
fray to develop drugs for the fatal, infectious disease. Now add to the list a
tiny, seed-stage startup spun out of UCSF, which has said it wants to crowdfund
cash to turn its experimental cancer drug into an Ebola treatment.

OncoSynergy is headquartered in San Francisco’s
Mission Bay neighborhood, in one of the life science incubators that make up
the California Institute for Quantitative Biosciences (QB3). Founded in 2011,
the six-employee company has an experimental drug, OS2966, that’s designed to
attack highly aggressive cancers. The Food and Drug Administration has
recognized it as an “orphan drug” that could treat glioblastoma, a coveted
designation that earns drug makers some tax credits and other incentives.

So what could cancer have to do with Ebola? OS266
apparently inhibits a cell adhesion molecule, CD29, that plays a major role in
cancer progression. And scientists also think that CD29 is hijacked by the
Ebola virus during infection (and blocking CD29 with monoclonal antibodies
similar to OncoSynergy’s drug has been shown in some studies to inhibit Ebola
infections).

So on the science crowdfunding site Experiment, the
privately held company wants to raise $10,000 in 30 days for a study that will
examine if OS2966 can block Ebola infection in human vascular cells. But the
company is so small, it can’t actually do the work itself. It’ll hand off the
project to scientists across the country through The Science Exchange, an
online marketplace that allows researchers to outsource experiments for a fee.

3 Music, math and the school curriculum (Namita
Devidayal in The Times of India) As math wizard Manjul Bhargava points out
there is an organic link between music and maths. Is it time schools rethink
their curriculum? When musician Taufiq Qureshi was a little boy, he was
perenially paranoid about his school maths until, one day, his father, the
tabla master Alla Rakha said, "Why are you so fearful? We do maths all the
time in our music.We are adding, subtracting, multiplying..." And he
proceeded to show his son, through a series of tabla compositions, how maths
was actually their second language - after music.

There is an organic connection between maths and
music - contrary to the perception that one is a cold rational subject and the
other a soft emotional one. Just as music is more than a collection of notes,
mathematics is more than numbers. Both are about structure, pattern,
abstractions and about connecting with the nature - the rhythmic movement of
the tides, of our breath, or that there being exactly the same number of petals
in daisies sprinkled across a field, which also corresponds to the Fibonacci
numbers in mathematics.

This is why Manjul Bhargava, the Princeton-base
mathematician, says he keeps a photograph of a field of daisies in his office. Bhargava,
who just won the world' most prestigious math prize, the Field Medal, is a
concert-level tabla player trained by Zakir Hussain. In his interviews, he
talks about the connection between math, music and poetry which, if taught
well, could produce an entirely different generation of creative thinkers.

"Why are people who are into exact sciences
like math and physics, also into music?" asks Suvarnalata Rao, a musicologist
with a background in physics "Because both require abstract thinking - to
be able to fathom that abstraction and its organization. That's why children
who trained in music will be able to organize thoughts much more
logically."

Why do our schools classify math in the core
curriculum and music as `extra-curricular'? Math, music, the study of daisies -
they all have to somehow filter into our classrooms and imagination.

1 Fed chief sees slack staying in US jobs market
(BBC) US Federal Reserve chair Janet Yellen has said there is still
"remaining slack in the labour market". It was understated by the
unemployment rate, at 6%, she said. Ms Yellen said the "underutilisation
of labour resources" still "remained significant" to the US
economy.

If inflation went up more rapidly than expected, she
said, increases in the federal funds rate target could "come sooner"
than expected and "could be more rapid thereafter". But she added:
"Of course, if economic performance turns out to be disappointing and
progress toward our goals proceeds more slowly than we expect, then the future
path of interest rates likely would be more accommodative than we currently
anticipate."

Luke Bartholomew, manager at Aberdeen Asset
Management Investment, said Ms Yellen was being "deliberately vague"
by telling the market "nothing to see here". He said there was
"some hint" she was still concerned about the labour market. "Which
is good because one of the biggest questions about the US economy is just how
many of the long term unemployed will ever return to the labour market. "The
fear is that no one, least of all Janet Yellen, knows the answer," he
added.

2 Europe’s existential question (Khaleej Times) The
EU’s latest slip back into contraction is raising near-existential questions
among observers of the continent. At an immediate level, Europe’s woes — of
Germany and Italy contracting 0.2 per cent for the second quarter — are
disheartening, particularly since they are the consequences of failed policies.

The public’s response has been growing cynicism and
xenophobia, with radical parties gaining popularity and calling for the
dissolution of the union. Rectifying the mistakes requires overcoming
substantial political inertia. There is reason to be disillusioned; and yet, it
almost unthinkable that borders will once again be closed and currencies split
along national lines. It is also worth noting how strong the symbolism of
Europe remains to emerging states such as Romania and Ukraine, which have
demonstrated strong public enthusiasm for the EU project.

At a broader scale, the EU is currently still the
world’s largest economy, worth more than $17 trillion in GDP, more than the US;
or even China, Japan and South Korea combined. The continent also boasts the
world’s best economies by living standards and quality of life.

The standard cautionary tale is to warn that Europe
could become another Japan, stuck helplessly in “lost decades” of stagnation.
Since its bubble burst in the early 1990s, Japan’s economy has grown roughly
one per cent a year, with recurring periods of contraction. So if Europe were
to become Japan… is it only a matter of wounded pride and investors’ profits?

The difference between the EU’s brightest — such as
Norway and the Netherlands — and its most troubled is too multi-faceted to fit
a simple narrative of a failed idea. The best of Europe remains in many ways
the best in the world, and is likely to remain that way for some time.

3 The clout of online ratings (Carlo Ratti &
Matthew Claudel in Straits Times) Travel websites have been around since the
1990s, when Expedia, Travelocity and other holiday booking sites were launched,
allowing travellers to compare flight and hotel prices with the click of a
mouse. Today, the industry is in the throes of a new revolution - this time,
transforming service quality. Online rating platforms - specialising in hotels
(TripAdvisor), restaurants (Zagat), apartments (Airbnb), and taxis (Uber) -
allow travellers to exchange reviews and experiences for all to see.

Hospitality businesses are now ranked, analysed and
compared not by industry professionals, but by the very people for whom the
service is intended - the customer. This has forged a new relationship between
buyer and seller. Customers have always voted with their feet; they can now
explain their decision to anyone who is interested. As a result, businesses are
much more accountable, often in very specific ways, which creates powerful
incentives to improve service.

The impact cannot be overstated. Businesses that
attract top ratings can enjoy exponential growth, as new customers are
attracted by good overall reviews and subsequently provide yet more (positive)
feedback. So great is the influence of online ratings that many companies now
hire digital reputation managers to ensure a favourable online identity.

Fortunately, technology is also countering this
misuse of ratings. Algorithms can already detect fake reviews by identifying
consistently positive or negative opinions from the same reviewer. Geolocation
tracking can ensure that only customers who have actually used a service can
express an opinion, as is the case with Airbnb.

Not every service, however, has been touched by
online ratings. The impact of ratings depends on whether the typical consumer
actually reads online reviews before making a decision. While it is
increasingly common to do so when, say, booking a hotel room, it is much less
so when deciding among, say, bars on a busy street. Needless to say, many
developed economies lag behind, at least for now. But the writing is,
literally, on the wall - or at least on the screen. Indeed, if you are reading
this online and disagree with me, you can explain why in the comments section
accompanying this commentary.

Thursday, August 21, 2014

1 Eurozone slowdown cools bounce back hopes (Graeme
Wearden in The Guardian) Private sector growth across the eurozone has slowed
this month, bringing job creation to a standstill and dampening hopes that
Europe's weak economy will rebound robustly from its recent stagnation.

The latest monthly index of purchasing managers
(PMI) found that France's economy continues to struggle. French manufacturing
activity is falling at its fastest rate in 15 months. The composite PMI for the
eurozone fell to a two-month low of 52.8 this month, down from 53.8 in July.
Factory output weakened, with the eurozone manufacturing PMI falling to a
13-month low of 50.8, closer to the 50-point mark that separates expansion from
contraction.

Firms also reported that job creation had slowed to
near-stagnation in August, suggesting that progress in cutting eurozone unemployment
is stalling. Concerns over the eurozone have risen, after figures last week
showed that the economy stagnated in the April to June quarter, with German GDP
shrinking by 0.2%. August's PMIs suggest that the eurozone will only manage
modest growth in the third quarter of 2014.

America's factory sector appears to be growing
strongly this month: the US manufacturing PMI jumped to 58.0, the highest
reading since April 2010, as companies put last winter's slowdown behind them.

2 Bank of America in $17bn mortgage settlement (BBC)
Bank of America has agreed to pay a record $16.7bn to US authorities for
misleading investors about the quality of loans it sold. The loans were sold by
Countrywide Financial and Merrill Lynch before Bank of America bought them in
2008, at the height of the financial crisis. The associate attorney general
said "no institution is either too big or too powerful to escape"
punishment.

The settlement will cut the bank's third-quarter
profits by $5.3bn. Bank of America will pay a total of $9.65bn in cash and
provide consumer relief worth about $7bn, much of which will go towards
homeowners struggling with their mortgages. The case centred on Countrywide
Financial, the biggest lender at the time of the crisis, and Merrill Lynch
selling mortgage loans to investors but not explaining the full extent of the
risk involved.

3 Ferguson and the militarization of US police
(Khaleej Times) The death of teenager Michael Brown in a suburb of the city of
St Louis, in the state of Missouri, US, on August 9 has shone a harsh spotlight
on a development that has taken place beyond public scrutiny. That development
is the astonishing and dangerous level of the militarisation of local police
forces in the US.

“The St. Louis County Police Department’s annual
budget is around US$160 million,” Newsweek had reported. “By providing law
enforcement agencies with surplus military equipment free of charge, the
National Defense Authorization Act encourages police to employ military weapons
and military tactics.” The disastrous result of such a piece of legislation can
be seen in local American communities which have unknowingly inherited the
spoils of foreign wars — from Iraq to Afghanistan. It is the stockpiling of
uncounted tonnes of military hardware, the samples of which have appeared on
the streets of Ferguson amid increasing street protests.

Only this June, the American Civil Liberties Union
released a report that pointed to the acquisition of military equipment by
local police as proof that police forces in the US are being transformed into
something potentially dangerous.

If there is a small hope to seize upon in the tale
of Ferguson, Missouri, it is that the public protests there and all over the
US, in solidarity, may coalesce into a movement that reacts to why Americans
have been shocked. The message of the
protestors is that a violent state response against communities will not be
tolerated, and that ordinary Americans cannot rely on the political system
alone to address such a problem. Perhaps Ferguson will prove to be the spark of
the peace movement that America so desperately needs.